NZD/USD has been in a bearish swing in November. When we look at the weekly chart, we can see that this is part of a bearish correction against the 2016 rally.
NZD/USD Daily Chart 11/22
(click to enlarge)
ABC Breaks Down Channel but Supported at 0.70:
- Since making the high on the year in September at 0.7480, NZD/USD has developed an ABC correction.
- The latest wave down, C, broke below a rising channel support.
- The latest wave down also brought price close to a common support/resistance pivot around 0.6960.
- However, there were strong buyers at the 0.70 area and the 200-day simple moving average.
Bullish Engulfer and the 0.72 Target:
- Looking at the daily chart, we can see a bullish engulfing candle from the 11/21 session.
- This is a early sign that maybe, price has found a pivot and will be ready for a bullish continuation scenario.
- The bullish continuation outlook is premature, but a short-term bullish swing to 0.72 is possible, even if the mode remains neutral-bearish.
- The area around 0.72 is a previous support pivot area, and coincident with the 100- and 50-day simple moving averages.